LINDA R. READE, Chief Judge.
TABLE OF CONTENTS
I. INTRODUCTION ...................................................... 918
II. PROCEDURAL BACKGROUND ............................................. 918
III. FACTUAL BACKGROUND ................................................ 920
IV. LEGAL BACKGROUND ................................................... 921
A. The Montana Exceptions .......................................... 921
B. This Court's Application of Montana ............................. 922
C. Eighth Circuit's Application of Montana ......................... 922
1. Trespass and trade secret claims ............................. 922
2. Conversion claim ............................................. 922
a. Second Montana exception .................................. 923
b. First Montana exception ................................... 923
V. PARTIES' ARGUMENTS ................................................ 924
VI. ANALYSIS .......................................................... 924
A. Tribal Court of Appeals' Views on First Montana Exception ...... 924
B. Jurisdiction under the First Montana Exception ................. 925
C. Location of API's Conduct ...................................... 926
1. Land status ................................................. 926
2. Where the conduct occurred .................................. 929
3. Summary ..................................................... 931
D. Tribe's Alternative Request .................................... 931
VII. CONCLUSION ........................................................ 931
This matter is before the court on remand from the Eighth Circuit Court of Appeals. See Attorney's Process and Investigation Servs., Inc. v. Sac & Fox Tribe of the Miss. in Iowa ("API"), 609 F.3d 927 (8th Cir.2010), cert. denied, ___ U.S. ___, 131 S.Ct. 1003, 178 L.Ed.2d 827 (2011). The sole issue is whether the Court of the Sac & Fox Tribe of the Mississippi in Iowa ("Tribal Court") has jurisdiction over the Sac & Fox Tribe of the Mississippi in Iowa's ("Tribe") claim against Attorney's Process and Investigation Services, Inc. ("API") for conversion of tribal funds. See id. at 946.
The Tribe sued API in the Tribal Court alleging trespass, conversion of tribal funds and misappropriation of trade secrets. See Sac & Fox Tribe of the Miss. in Iowa v. Attorney's Process Investigation Servs., Inc., Tribal Court case no. API-CV-Damages-2005-01. The Tribe's claims arise from API's efforts to take control of facilities on the Tribe's reservation under a contract signed by Alex Walker, Jr., the former Chairman of the Tribal Council. The Tribe's conversion claim is based on the payment of more than $1 million of tribal funds to API under its contract with Walker.
After exhausting its remedies in the Tribal Court, API returned to this court. The Tribe filed a Motion to Dismiss (docket no. 48), arguing that the court lacked subject matter jurisdiction and jurisdiction over the Tribe. API filed a Motion for Partial Summary Judgment (docket no. 63), arguing that the Tribal Court lacked subject matter jurisdiction.
On June 18, 2009, 2009 WL 1783497, the court entered an Order (docket no. 87) that denied API's Motion for Partial Summary Judgment and granted the Tribe's Motion to Dismiss. In doing so, the court held that the Tribal Court had jurisdiction over the Tribe's claims under Montana v. United States, 450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 493 (1981).
API appealed, arguing that the Tribal Court lacked jurisdiction over the Tribe's claims and that this court erred in its application of Montana. The Eighth Circuit affirmed that the Tribal Court could exercise jurisdiction over the Tribe's trespass and trade secret claims. API, 609 F.3d at 946. However, the Eighth Circuit reversed and vacated "only that portion of the judgment which concluded that the Tribal Court has jurisdiction under the second Montana exception over the Tribe's claim for conversion of tribal funds." Id. Accordingly, the Eighth Circuit remanded "the question of whether tribal court jurisdiction exists over that claim under the first Montana exception." Id.
On February 7, 2011, the Tribe filed a Motion for Summary Judgment ("Tribe's Motion") (docket no. 112), arguing that the Tribal Court correctly held that it had jurisdiction over the Tribe's conversion claim. In the event the court holds otherwise, the Tribe asks the court to enter judgment in favor of the Tribe on its conversion claim.
On March 29, 2011, API filed a Resistance (docket no. 117) to the Tribe's Motion. That same date, API filed a Cross-Motion for Summary Judgment ("API's Motion") (docket no. 118), arguing that the Tribal Court lacks jurisdiction over the conversion claim under the first Montana exception. On May 2, 2011, the Tribe filed a combined Resistance and Reply (docket no. 129) in opposition to API's Motion and in support of the Tribe's Motion. On May 12, 2011, API filed a Reply (docket no. 131).
The Tribe is a federally recognized Indian tribe governed by a seven member Tribal Council. The Tribe owns and operates the Meskwaki Bingo Casino Hotel ("Casino"). The Casino is located on the Tribe's trust lands, known as the Meskwaki Settlement, in Tama, Iowa. Alex Walker, Jr. is a member of the Tribe and at all relevant times resided on tribalowned land within the Tribe's Settlement. Prior to March of 2003, Walker was Chairman of the Tribal Council.
In the spring and summer of 2003, two groups were competing for control of the tribal government, finances and Casino. Walker led one group (the "Walker Council"), and Charles Old Bear headed up the opposition (the "Bear Council"). In May of 2003, the Bear Council prevailed in a tribal election. Walker then turned to API, a Wisconsin corporation that provides security and consulting services to casino operators.
On June 16, 2003, Walker entered into a written contract—purportedly on behalf of the Tribe—with API for investigation, security and law enforcement consulting services. API agreed to "perform services directly relating to the investigation of a takeover by dissidents at the Tribe's facility located on the Tribe's reservation lands." Tribe's Appendix ("Tribe App'x") (docket no. 112-3) at 22. In furtherance of this goal, API agreed its services would "include, but not be limited to, the following:"
Id. at 22-23. The contract also contained an arbitration clause and provided that any award would be enforced in Iowa state or federal court. The Tribe was not a party to the contract and has "not enter[ed] into any agreement with API." API, 609 F.3d at 945.
Between June 30 and September 30, 2003, API received $1,022,171.26 in tribal funds under its agreement with Walker. The Tribal Council did not consent to any payment of tribal funds to API. Neither the Tribal Chairman nor the Tribal Council Treasurer signed any documents permitting payment of tribal funds to API.
On August 3, 2005, the Tribe filed a complaint against API in the Tribal Court, alleging trespass, misappropriation of trade secrets and conversion. With respect to the Tribal Court's jurisdiction, the Tribe alleged:
Tribe App'x at 1. Regarding its conversion claim, the Tribe alleged, in part:
Id. at 2.
The court begins with the principles governing tribal jurisdiction over nonmembers. The court will then briefly summarize the application of these principles to this case by this court and the Eighth Circuit Court of Appeals.
Generally, a tribe may not exercise civil jurisdiction over nonmembers. See Montana, 450 U.S. at 565, 101 S.Ct. 1245. However, this rule is subject to two independent exceptions. First, a "tribe may regulate, through taxation, licensing, or other means, the activities of nonmembers who enter consensual relationships with the tribe or its members, through commercial dealing, contracts, leases, or other arrangements." Id. Second, a tribe may "exercise civil authority over the conduct of non-Indians . . . within its reservation when that conduct threatens or has some direct effect on the political integrity, the economic security, or the health or welfare of the tribe." Id. at 566, 101 S.Ct. 1245.
In applying the Montana exceptions to nonmembers, "a tribe's adjudicative jurisdiction does not exceed its legislative jurisdiction."
In granting the Tribe's Motion to Dismiss, this court held that the Tribal Court had jurisdiction over the Tribe's claims under the second Montana exception because "API's conduct had a `direct effect' on both the political integrity and the economic security of the Tribe." Order at 17 (quoting Montana, 450 U.S. at 566, 101 S.Ct. 1245). Accordingly, the court did not decide whether the Tribal Court could exercise jurisdiction over the Tribe's claims under the first Montana exception.
On appeal, the Eighth Circuit explained that the Tribe's claims "arise from two related, but ultimately distinct, courses of conduct." API, 609 F.3d at 938.
Id. at 939.
With respect to the Tribe's trespass and trade secret claims, the Eighth Circuit upheld this court's application of the second Montana exception:
Id. at 940 (alteration in original) (internal quotation marks and citations omitted).
The Eighth Circuit reasoned that API's conduct, which amounted to an "attempted coup d'etat," id. at 939 n. 6, "was a direct attack on the heart of tribal sovereignty, the right of Indians `to protect tribal self-government.'" Id. at 939 (quoting Montana, 450 U.S. at 564, 101 S.Ct. 1245). The Eighth Circuit also noted that the Tribe's trespass and trade secret claims sought to regulate API's entry and conduct on tribal trust land, and a tribe's "civil authority is at its zenith when the tribe seeks to enforce regulations stemming from its traditional powers as a landowner." Id. at 940 (citing Hicks, 533 U.S. at 370, 121 S.Ct. 2304).
The Eighth Circuit concluded that the Tribe's conversion claim is "materially different" from the other torts. Id.
Id. The Eighth Circuit noted, "[i]t is of course possible that API was paid in advance for planning and executing the raid, but that has not been alleged." Id.
The Eighth Circuit held that the Tribe "failed to carry its burden of establishing adjudicatory jurisdiction over the conversion claim under the second Montana exception." Id. at 941. In reaching this holding, the Eighth Circuit observed that the conversion claim does not seek to regulate conduct on the Tribe's Settlement. Because Montana permits tribal regulation of nonmember conduct inside the reservation, "the Tribe must show that the conduct it seeks to regulate occurred within the Meskwaki Settlement." Id. at 940. The Tribe's conversion claim, the Eighth Circuit explained, seeks to regulate "API's unauthorized receipt and retention of tribal funds." Id. Because the Tribe did not allege that the receipt or retention of funds occurred on the reservation, the Eighth Circuit could not conclude "that the conduct most directly regulated by the conversion claim occurred on tribal land." Id. at 940-41.
The Eighth Circuit also concluded that the Tribe failed to "adequately delineate[ ] an indirect relationship between the conversion claim as a whole and API's conduct on tribal land, for it remains unclear what portion of the allegedly converted funds may relate to the October 1 raid, as opposed to other services API might have performed under the contract with Walker." Id. at 941. Because it could not determine what the funds paid for, the Eighth Circuit concluded it was unable to "examine what conduct by API the conversion claim seeks to regulate." Id. Even if some of the funds related to the October 1 raid, the Eighth Circuit stated this "is not enough to sustain jurisdiction over the claim as a whole, for `when it comes to tribal regulatory authority, it is not in for a penny, in for a Pound.'" Id. (quoting Plains Commerce Bank, 554 U.S. at 338, 128 S.Ct. 2709) (internal quotation marks omitted). In sum, the Eighth Circuit concluded that "the Tribe has failed to carry its burden of establishing adjudicatory jurisdiction over the conversion claim under the second Montana exception." Id.
The Eighth Circuit noted that "[t]he question remains, however, whether the first Montana exception could provide tribal court jurisdiction over the conversion claim." Id. Although the contract between Walker and API was not binding on the Tribe, the Eighth Circuit observed that this was not determinative:
Id. Declining to answer this question without analysis by the district court, the
The Tribe argues that a sufficient nexus exists between its conversion claim and API's consensual relationship with Walker to support Tribal Court jurisdiction under the first Montana exception. According to the Tribe, the requisite nexus is present if, based upon API's consensual relationship with Walker, API engaged in conduct that the Tribe had authority to regulate. Because the Tribe has the sovereign authority, expressed in its Constitution, to determine how tribal funds are spent, the Tribe insists it has the authority to regulate API's conduct in converting the Tribe's funds.
API raises a number of arguments in response. First, API contends that the Tribal Court lacks jurisdiction because the conduct the conversion claim seeks to regulate did not occur on the Tribe's Settlement. Second, API argues that the first Montana exception does not authorize tribal jurisdiction over all nonmember business activities within a reservation. Third, API asserts that the conduct the conversion claim seeks to regulate has no nexus with API's consensual relationship with Walker. Fourth, API insists that the Tribal Court's views on the first Montana exception are conclusive and cannot be disturbed by this court. Finally, API argues that it has not consented to Tribal Court jurisdiction, as evidenced by the inclusion of an arbitration clause in its contract with Walker.
API questions the court's authority to address the issue presented on remand. According to API, this court cannot disturb the Tribal Court of Appeals' view that the first Montana exception does not apply. The court addresses this contention first, before turning to the remaining issues.
The Tribal Court of Appeals opined that the first Montana exception did not apply:
API Appendix ("API App'x") (docket no. 118-3) at 49. API argues that this ruling is "conclusive" and this court "cannot and should not disturb the Tribal Court of Appeals['] decision to refuse jurisdiction under the first Montana exception." Brief in Support of API's Resistance ("API Resistance Br.") (docket no. 117-1) at 17-18. In API's view, while a federal court may decide whether a tribe has exceeded its jurisdiction, it has no authority to force jurisdiction upon an unwilling tribal court.
There are several problems with API's position. First of all, the Tribal Court of Appeals' statement regarding the first exception is dicta. Because the Tribal Court of Appeals ultimately upheld jurisdiction under the second Montana exception, its statements about the first exception were unnecessary to its decision. Second, the Tribal Court of Appeals' statement is not as broad as API suggests. The Tribal Court of Appeals focused on the fact that the Tribe did not have a consensual relationship with API, but apparently did not consider the possibility that jurisdiction could be based upon a consensual relationship
API's position suffers from a more fundamental flaw: it is completely at odds with the purpose of the Eighth Circuit's remand. The Eighth Circuit directed this court to do exactly what API claims is forbidden—it remanded this matter "so that the district court may consider the applicability of the first Montana exception to the Tribe's conversion claim." Id. More importantly, the Eighth Circuit did so only after acknowledging the Tribal Court of Appeals' view "that the first exception did not apply." Id. Given the Eighth Circuit's remand, as well as its awareness of the Tribal Court of Appeals' view on the matter, the court will not ignore the very purpose of the remand. Accordingly, the court rejects API's argument that the court cannot consider the applicability of the first Montana exception to the Tribe's conversion claim.
"The starting point for the jurisdictional analysis is to examine the specific conduct the Tribe's legal claims would seek to regulate. The Montana exceptions focus on `the activities of nonmembers' or `the conduct of non-Indians.'" Id. at 937 (quoting Plains Commerce Bank, 554 U.S. at 330, 128 S.Ct. 2709) (internal quotation marks omitted). Here, the Tribe's conversion claim seeks to regulate "API's unauthorized receipt and retention of tribal funds." Id. at 940.
Id. at 937.
The first Montana exception "recognizes tribal power to regulate nonmembers when they `enter consensual relationships with the tribe or its members.'" Id. at 941 (quoting Montana, 450 U.S. at 565, 101 S.Ct. 1245). If such a consensual relationship exists, "the operative question for jurisdictional purposes is whether the conversion claim has a sufficient nexus to the consensual relationship." Id.
The Eighth Circuit already decided that API had a consensual relationship with Alex Walker, Jr., a tribal member. See id. ("[T]he operative question for jurisdictional purposes is whether the conversion claim has a sufficient nexus to the consensual relationship between Walker and API." (emphasis added)). Even without this guidance, the consensual relationship requirement is plainly met in this case, where API entered into a services contract with a tribal member. See Montana, 450 U.S. at 565, 101 S.Ct. 1245 (describing
Before addressing whether the requisite nexus is present, API argues that the first Montana exception does not apply because the Tribe offers no proof that the conduct underlying the conversion claim occurred on the Tribe's Settlement. According to API, this is a "necessary condition" for Tribal Court jurisdiction and it is "essential" that "the Tribe prove that the activities that the conversion claim seeks to regulate occurred on the Meskwaki Settlement." API Resistance Br. at 8-9; see also Brief in Support of API's Motion ("API Br.") (docket no. 118-1) at 7-8 (stating same). Although it faults API for raising the issue at this point, the Tribe concedes that this is a prerequisite for Tribal Court jurisdiction under the first Montana exception. See Tribe's Resistance & Reply at 5-6 (arguing that the Tribe made a sufficient showing that API's conversion occurred on the Settlement).
Despite the parties' apparent agreement on this issue, the court deems it appropriate for further discussion. Accordingly, the court first considers whether this is, in fact, a "necessary" and "essential" condition for Tribal Court jurisdiction. If it is, the court will decide whether it is met in this case.
The Supreme Court has frequently considered land status when assessing tribal jurisdiction over nonmembers. The usual distinction, however, has been between reservation land owned by or held in trust for a tribe or its members, sometimes called "trust land," and so-called "non-Indian fee lands," that is, land within a reservation that has been "acquired in fee simple by non-Indian owners." Strate, 520 U.S. at 446, 117 S.Ct. 1404. While Montana's general rule—that tribes lack civil jurisdiction over nonmembers—"applies to both Indian and non-Indian land," Hicks, 533 U.S. at 360, 121 S.Ct. 2304, a tribe is more likely to have civil jurisdiction over nonmember conduct on Indian land. See id. (noting that land status "may sometimes be a dispositive factor" and "the absence of tribal ownership has been virtually conclusive of the absence of tribal civil jurisdiction"); Strate, 520 U.S. at 454, 117 S.Ct. 1404 ("[T]ribes retain considerable control over nonmember conduct on tribal land.").
The distinction between Indian land and non-Indian fee land within a reservation, at least for jurisdictional purposes, appears to be waning. In Hicks, for example, the Court stated that "[t]he ownership status of land . . . is only one factor to consider in determining whether regulation of the activities of nonmembers is `necessary to protect tribal self-government or to control internal relations.'" Hicks, 533 U.S. at 360, 121 S.Ct. 2304 (quoting Montana, 450 U.S. at 564, 101 S.Ct. 1245). The Court has since reiterated this point, stating that "[t]he status of the land is relevant `insofar as it bears on the application of . . . Montana's exceptions to [this] case." Plains Commerce Bank, 554 U.S. at 331, 128 S.Ct. 2709 (quoting Hicks, 533 U.S. at 376, 121 S.Ct. 2304 (Souter, J., concurring)); see also Hicks, 533 U.S. at 387, 121 S.Ct. 2304 (O'Connor, J., concurring) ("Today, the court finally resolves that Montana v. United States governs a tribe's civil jurisdiction over nonmembers regardless of
Despite the oft-invoked distinction between Indian land and non-Indian fee land within a reservation, this is not the precise distinction at issue here. Neither side suggests that any non-Indian fee lands were involved in the events giving rise to the Tribe's conversion claim. Rather, API argues that the Tribe has failed to prove that API's conduct underlying the conversion claim—the unauthorized receipt and retention of tribal funds—occurred on the Tribe's reservation at all, ignoring any distinction between Indian land and non-Indian fee land within the Settlement. Because the Tribe has failed to satisfy "this necessary condition for [T]ribal [C]ourt jurisdiction," API argues it is entitled to summary judgment. API Resistance Br. at 9.
The Eighth Circuit discussed the issue of land status with respect to the Tribe's conversion claim, stating:
API, 609 F.3d at 940-41 (citations omitted).
In making its "on the Settlement" argument, API relies heavily on this passage of the Eighth Circuit's opinion. However, this reliance may be misplaced. First of all, the above discussion was, by its terms, limited to "jurisdiction over the conversion claim under the second Montana exception," id. at 940 (emphasis added), which is not before the court. More perplexing, however, is that after acknowledging the complete absence of any allegation by the Tribe that the conversion occurred on the Settlement, the Eighth Circuit declared, "[t]he question remains, however, whether the first Montana exception could provide tribal court jurisdiction over the conversion claim." Id. at 941. Thus, the Eighth Circuit appeared to imply that tribal jurisdiction over the conversion claim could exist under the first Montana exception despite the fact that the conduct it seeks to regulate did not occur on the Settlement.
The question, then, is whether tribal jurisdiction may exist under the first Montana exception even if the conduct at issue occurred outside the reservation. The simple answer appears to be no. In Hornell Brewing Co. v. Rosebud Sioux Tribal Court, 133 F.3d 1087, 1089 (8th Cir.1998), Crazy Horse's estate sued several breweries in tribal court over the use of the Crazy Horse name in connection with a malt liquor beverage. The Eighth Circuit began by stressing that tribal jurisdiction extends only to nonmember activities on the reservation:
Id. at 1091.
The Hornell Brewing court went on to note that the nonmember activities at issue—the manufacture, sale and distribution of malt liquor—did not occur on the tribe's reservation. Id. Furthermore, the parties "fail[ed] to cite a case in which the adjudicatory power of the tribal court vested over activity outside the confines of a reservation." Id. The Eighth Circuit ultimately held that the tribal court lacked jurisdiction, stating it was "plain that the [defendants'] conduct outside the Rosebud Sioux Reservation does not fall within the Tribe's inherent sovereign authority."
As one court observed, Hornell Brewing "clearly held that tribal jurisdiction does not extend to . . . off reservation activities." Christian Children's Fund, Inc. v. Crow Creek Sioux Tribal Court, 103 F.Supp.2d 1161, 1166 (D.S.D.2000). Accordingly, tribal jurisdiction is lacking where the nonmember conduct at issue did not occur on the tribe's reservation. See Yankton Sioux Tribe Head Start Concerned Parents v. Longview Farms, LLP, No. CIV. 08-4058, 2009 WL 891866, at *3 (D.S.D. Mar. 31, 2009) ("The Tribe does not have regulatory authority over the construction of the farrowing facility by Defendant, a non-Indian entity, because such facility is located on land which is not within reservation boundaries."); Progressive Specialty Ins. Co. v. Burnette, 489 F.Supp.2d 955, 958 (D.S.D.2007) ("Indian tribes are not permitted to exercise jurisdiction over the activities or conduct of non-Indians occurring outside the reservation.").
Supreme Court precedent also suggests that conduct on the reservation— whether it be tribal trust land or non-Indian fee land within the reservation—is a sine qua non to tribal jurisdiction over nonmembers, regardless of which Montana exception is invoked. In Plains Commerce Bank, the Court stated that "Montana and its progeny permit tribal regulation of nonmember conduct inside the reservation that implicates the tribe's sovereign interests." 554 U.S. at 332, 128 S.Ct. 2709 (second emphasis added); see also id. (noting that the cases cited in Montana as examples of the first exception "[e]ach involved regulation of non-Indian activities on the reservation that had a discernible effect on the tribe or its members" (emphasis added)); cf. Hicks, 533 U.S. at 375-76, 121 S.Ct. 2304 (Souter, J., concurring) ("[L]and status within a reservation is not a primary jurisdictional fact . . . ." (emphasis added)). Montana itself supports this requirement, where the Court prefaced the Montana exceptions with the statement that "tribes retain inherent sovereign power to exercise some forms of civil jurisdiction over non-Indians on their reservations." 450 U.S. at 565, 101 S.Ct. 1245 (emphasis added); see also Plains Commerce Bank, 554 U.S. at 334, 128 S.Ct. 2709 ("[O]ur Montana cases have always concerned nonmember conduct on the land."). Thus, the court agrees with API that to sustain tribal jurisdiction over the conversion claim, the conduct the conversion claim seeks to regulate must have occurred within the Tribe's Settlement.
"The conduct the [Tribe's] conversion claim seeks to regulate most directly is API's unauthorized receipt and retention of tribal funds." API, 609 F.3d at 940. Accordingly, the issue is whether this conduct occurred on the Tribe's Settlement. "[T]he Tribe bears the burden of showing that its assertion of jurisdiction falls within one of the Montana exceptions." Id. at 936.
To satisfy this burden, the Tribe points to the following allegation in its Tribal Court complaint:
Tribe App'x at 1. According to the Tribe, its complaint "alleges API's actions, including converting the Tribe's funds, occurred within the Tribe's jurisdiction." Brief in Support of Tribe's Motion ("Tribe Br.") (docket no. 112-1) at 11.
The court disagrees with the Tribe that this allegation, standing alone, satisfies its burden. The Tribal Court complaint was part of the record on appeal, and the Eighth Circuit expressly relied on "the allegations in the Tribe's complaint" in addressing the jurisdictional question. API, 609 F.3d at 937. The Eighth Circuit also noted that API did not contest any of the Tribe's material allegations. Id. Nonetheless, the Eighth Circuit concluded that "[t]he Tribe makes no allegation that the receipt or retention of the funds occurred within the Meskwaki Settlement." Id. at 940-41. In other words, the Eighth Circuit was aware of the Tribe's allegations, but apparently found them insufficient on this issue. The court is in no position to disturb this conclusion and, therefore, disagrees with the Tribe that its allegations are "established facts."
Aside from the above allegation, the record essentially is devoid of any insight into the location of API's alleged conversion— i.e., unauthorized receipt and retention—of tribal funds.
The fact remains, however, that "the Tribe bears the burden of showing that its assertion of jurisdiction falls within one of the Montana exceptions." API, 609 F.3d at 936. The court must rely on the record developed in the tribal courts; indeed, it is "both necessary and appropriate for the parties and the tribal court to ensure that `a full record [is] developed in the Tribal Court.'" Id. at 937 (alteration in original) (quoting Nat'l Farmers Union, 471 U.S. at 856, 105 S.Ct. 2447). The court doubts whether this was done here, but the Tribe chose instead to rely on a generalized allegation that failed to convince the Eighth Circuit that API's unauthorized receipt and retention of tribal funds occurred on the Tribe's Settlement. The Tribe offers nothing to alter this conclusion, and the court, therefore, cannot conclude that the conduct the Tribe's conversion claim seeks to regulate most directly, i.e., "API's unauthorized receipt and retention of tribal funds," id. at 940, occurred within the Tribe's Settlement.
The Tribe posits that "the only significant benefit that API obtained from acting as Walker's mercenary force was access to millions of dollars in tribal funds." Tribe Br. at 4. The Tribe also asserts that the purpose of API's consensual relationship with Walker was API's investigation of Tribal Council members, as well as the planning and execution of the raid on the Tribe's Settlement:
Id.
The Tribe's emphasis on the possibility
The Tribe also relies on its allegation in the Tribal Court complaint that "the actual harm from API's activities occurred on tribal land." Tribe's Resistance & Reply at 6. However, this obscures the issue, as "[t]he Montana exceptions focus on `the activities of nonmembers' or `the conduct of non-Indians.'" API, 609 F.3d at 937 (quoting Plains Commerce Bank, 554 U.S. at 330, 128 S.Ct. 2709 (internal quotation marks omitted)). As such, the jurisdictional inquiry focuses not on where the harm was suffered, but "examine[s] the specific conduct the Tribe's legal claims would seek to regulate." API, 609 F.3d at 937. Allowing tribal jurisdiction any time a tribe or tribal member suffered harm on the reservation could run afoul of the Supreme Court's admonition that the Montana exceptions not "be construed in a manner that would `swallow the rule' or `severely shrink' it." Plains Commerce Bank, 554 U.S. at 330, 128 S.Ct. 2709 (citations omitted).
"Montana and its progeny permit tribal regulation of nonmember conduct inside the reservation that implicates the tribe's sovereign interests." Plains Commerce Bank, 554 U.S. at 332, 128 S.Ct. 2709 (second emphasis added). Stated conversely, "[n]either Montana nor its progeny purports to allow Indian tribes to exercise civil jurisdiction over the activities or conduct of non-Indians occurring outside their reservations." Hornell Brewing, 133 F.3d at 1091.
The Tribe's conversion claim seeks to regulate API's "unauthorized receipt and retention of tribal funds." API, 609 F.3d at 940. As the Eighth Circuit noted, the Tribe made no allegation that this conduct occurred within the Meskwaki Settlement. Id. On remand, the Tribe offers nothing to alter this analysis or allow the court to conclude that API's conduct underlying the conversion claim occurred on the Tribe's reservation. Thus, the Tribe has failed to satisfy a necessary condition for tribal jurisdiction over a nonmember and, therefore, failed to carry its burden of establishing adjudicatory jurisdiction over the conversion claim under the first Montana exception.
In the event the court concluded the Tribal Court lacks jurisdiction over the Tribe's conversion claim, the Tribe asks the court to "enter judgment against API for $1,022,171.26 plus interest." Tribe's Motion at ¶ 2. API contends this request is "baseless," pointing out that the Tribe has not filed a conversion claim or counterclaim against API in this court. API Resistance Br. at 2. API also notes that the Tribal Court's factual findings for jurisdictional purposes "plainly do not constitute a determination of the merits of the Tribe's conversion claim." Id.
The court agrees with API. The Tribe has not a filed a claim in this court, and the parties have not litigated the merits of the Tribe's conversion claim. Further, the proceedings in the Tribal Court were limited to the issue of jurisdiction. See Tribe App'x at 115 ("The Tribe's ability to actually recover from API on its underlying claims, which have yet to be decided by the Tribal Court, depends upon whether the Tribal Court has jurisdiction over API."). Accordingly, the court shall deny the Tribe's Motion to the extent it asks the court to enter judgment against API on the conversion claim.
The court concludes that the Tribal Court may not exercise jurisdiction over
